Last week, there were two main news items in the financial market regarding the exchange rate: a significant increase in the National Bank's discount rate, which is the annual interest rate at which the regulator lends to commercial banks, and a noticeable strengthening of the hryvnia. TSN reports. This information is provided by Kontrakty.UA.
The discussion of a 43 hryvnia rate for one cash dollar has long ceased, as the American currency has depreciated to levels seen a month ago, specifically below 42.40 UAH/USD.
To understand why the downward trend is gaining momentum, what to expect from the exchange rate in the last week of January and the beginning of February, and whether it is currently more advantageous to hold dollars, euros, or other options, read the weekly analytical project from TSN.ua.
Our experts include: Oleg Pendzin, a member of the Economic Discussion Club, Andriy Zablovsky, head of the Secretariat of the Entrepreneurs' Council under the Cabinet of Ministers, and Andriy Shevchishin, a financial analyst and member of the Ukrainian Society of Financial Analysts.
What is happening in the currency market
The National Bank reported that as of January 24 of this year, the discount rate increased by 1%, reaching 14.5% per annum. This move aims not only to achieve sustained strengthening but at least to curb the devaluation of the hryvnia in the coming months. According to specialized sites finance.ua and minfin.com.ua, from January 20 to 26, the hryvnia continued to appreciate against the dollar. On Monday, January 20, the average selling rate of the dollar in the cash market was 42.67 UAH/USD, while by Sunday, January 26, it had dropped to 42.30 (-37 kopecks). The buying rate of the dollar decreased by 44 kopecks, to 41.80 UAH/USD.
The highest selling price of the dollar was 42.55 UAH (-35 kopecks for the week), and the lowest was 42.18 UAH/USD (-12 kopecks). The maximum buying rate was 42.05 UAH (-25 kopecks).
The cash euro appreciated throughout the week. By Sunday, January 26, the rate reached 44.40 UAH (+31 kopecks for the week) and 43.70 UAH (+36 kopecks for the week) for selling and buying, respectively.
On the black market, according to the "minyaylo" service (miniaylo) on finance.ua, where offers for buying and selling cash currency between individuals are published, the downward trend in the dollar rate has continued for the second consecutive week. From Monday, January 20, to Sunday, January 26, the average selling rate fell by 32 kopecks to 42.16 UAH/USD, while the buying rate dropped by 38 kopecks to 42.13 UAH/USD.
The euro's exchange rate continues to fluctuate sinusoidally for the third consecutive week: one day it rises, the next day it falls. However, the fluctuations have become half as large as before. From January 20 to 25, the fluctuations were within 20 kopecks for selling, ranging from 44.10 to 44.30 UAH/euro, and 32 kopecks for buying, from 43.90 to 44.22 UAH/euro. By Sunday, January 26, the selling rate among illegal traders was 44.42 UAH (+28 kopecks for the week), and the buying rate was 44.15 UAH/euro (+5 kopecks for the week).
Over the week, the National Bank strengthened the hryvnia against the dollar by 20 kopecks. On Monday, January 27, the official rate was set at 41.93 UAH/USD.
The official euro rate fluctuated in different directions over the past week, with fluctuations within 50 kopecks, from 43.37 to 43.87 UAH/euro. On January 27, the regulator set the rate at 43.92 UAH/euro (+55 kopecks for the week). The euro has appreciated for the second consecutive week.
The dollar/euro ratio increased from 1.03 to 1.05 dollars per euro.
Andriy Shevchishin noted that last week, the demand for currency in the interbank foreign exchange market decreased by 15%, while the supply increased by 4%. In the cash market, demand decreased by 4%, and supply increased by 14%.
"Such trends have impacted the dollar rate downward, and the National Bank raised the discount rate more than expected, thus strengthening the hryvnia. I do not rule out that the regulator will raise the discount rate two more times in the first half of the year, which should curb both inflation and the devaluation of the hryvnia," the expert analyzed.
What to expect from the exchange rate
Experts agree that further strengthening of the hryvnia this week is unlikely.
"The cash hryvnia rate will likely stabilize at the current level, that is, above 42, but below 42.5 UAH/USD," Andriy Shevchishin clarified.
Oleg Pendzin pointed out that the first actions of the new U.S. president showed that both economic and military support for Ukraine will continue. This positively influenced investor sentiment and indirectly affected the mood of Ukrainians, who were worried that the dollar would rise sharply.
"Pessimistic forecasts did not materialize; the trend has changed, and the financial and economic development model of Ukraine in 2025 is considered positive," Oleg Pendzin analyzed. "In the week from January 27 to February 2, we will have a cash hryvnia rate in the range of 42-42.5 UAH/USD. The dollar's depreciation will gradually cease, and I do not expect the selling rate to drop below 42 UAH/USD."
Andriy Zablovsky added that the spike in the rate to 43 UAH/USD was speculative, caused by an excess of hryvnias in the interbank and cash markets, and the National Bank promptly reduced it by selling currency.
"This does not mean that the devaluation expectations of the hryvnia have disappeared, but devaluation will be slow," the expert believes. "This week, we will have a stable situation with the interbank rate around 42 UAH/USD. The cash rate will average 42.30 UAH/USD for selling and below 42 UAH for buying."
To sell or buy currency
Experts have concluded that it is currently worth both buying and selling currency.
Andriy Shevchishin believes that those with spare funds should decide whether they want to earn quickly "on money" or wish to ensure its preservation for years to come.
"It is currently impossible to earn quickly on dollars due to the rising rate, this is obvious," Andriy Shevchishin pointed out. "But let me remind you: the average dollar rate in 2025 is projected to be 45 UAH, meaning by the end of the year it could be 47 UAH/USD. Compared to today’s 42.40 UAH/USD, this represents an increase of nearly 11%, which is comparable to earnings from deposits in hryvnias. Typically, these are deposits for a certain term because the interest rates are significantly higher than on current deposits, making it impossible to withdraw funds early. Cash dollars are always at hand if needed. While the dollar is depreciating, it is worth buying because in a year or two, the rate will be noticeably higher. An alternative to the dollar is domestic government bonds (OVDP), the yield of which is guaranteed to exceed the profit from the dollar's rate increase this year."
Oleg Pendzin provided a calculation that confirms the correctness of investing in hryvnias rather than in currency.
"Let me remind you: an investment is the allocation of funds into a specific project with the aim of making a profit," Oleg Pendzin began. "Those who, amid panic-driven dollar growth, bought cash dollars in January this year at an average of 43 UAH per unit, lost over 60 kopecks if calculated at the selling rate and 1.20 UAH if calculated at the buying rate, at which dollars can be converted back into hryvnias today. Thus, such an 'investment' has already incurred losses of 1.4-2.8%. Conversely, a hryvnia deposit opened on January 2 will yield a net profit of 0.8-1% on each invested hryvnia by the end of the month. OVDP are even more profitable, as they are not subject to the 23% profit tax like deposits. They will yield a 'profit' of 1.4% from the invested amount in a month. If, for example, 30,000